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Measured improvment: The metrics of metal shops that weld

Reducing manual labour in agriculture through automation machinery is not a new concept.

In fact, Iowa-based Vermeer Corp. is considered a significant contributor to the agricultural industry since its 1948 inception. A family owned business, Vermeer manufactures many agricultural machines which directly ease the need for manual labor in the agricultural industry.

Cory Plants, manufacturing engineer at Vermeer says, "metal shops that weld have to use various metrics to assess the performance of the overall production line, which involves fabrication, machining, welding and assembly. Welding metrics are unique because it is highly dependent on the skills of the individual welder and lower volumes sometimes make the process difficult to automate.”

Forty years ago, Gary Vermeer invented the first large round baler, revolutionizing how hay was harvested. The demand for agricultural equipment increased and Vermeer starting manufacturing machines ranging from wood chippers to trenchers, from round balers to surface mining equipment. Now in its sixth decade, Vermeer has operations throughout the United States, Netherlands, Brazil, Germany, Singapore, and China. The scope still includes machines for the agricultural industry as well as more than eight diverse industries worldwide.

Leaning Forward As Exports Create New Challenges

Worldwide growth requires a best-practices organization. Gary Vermeer saw that exports of the company's machinery accounted for half of the revenue, noting, "It was vitally important that all manufacturing operations run as smoothly as possible so we decided to embrace Lean Manufacturing philosophies and Continuous Improvement initiatives as core disciplines in our relentless search for improvement and cost reduction.”

Lean supporters at Vermeer were faced with a big job; the task of consolidating operations between the nine facilities, including identifying practices which hindered the manufacturing process of manufacturing. The lean team had to implement the changes to foster improvements, as well as capitalizing on capacity to achieve improved efficiencies.

Each of the nine facilities evolved its operation and became a separate business unit. The new approach revitalized the overall enterprise by grouping operations into more logical cells, reduce redundancy, and vastly improve the workflow.

Seeing is Believing: Takt Time Metrics for Welders and Kanban

"Takt time metrics help to ensure that the individual welders are working to the desired performance level. OEE metrics can be applied to equipment to track automatically the performance, and all combined generate an accurate overall production monitoring and costing process,” notes Cory Plants.

As with most organizations that embrace Lean initiatives, Vermeer quickly realized that there was a lack of visibility on the shop floors. The company used a kanban system, which provided a daily requirement of parts to be machined, or a product to be assembled. Kanban is a method for developing products with an emphasis on just-in-time delivery. It emphasizes that developers must pull work from a queue. Said simply, kanban is a visual process management system that tells what to produce, when to produce it, and how much to produce. As a method it is an approach to incremental, evolutionary process change for organizations.

While kanban is a basic tenet of lean manufacturing, Vermeer discovered it lacked the incentive to drive manufacturing and meet the demands of customers in a timely fashion. Gary Vermeer acknowledges, "we had no system in place that could ultimately measure productivity, labor, utilization output of machines, and facilities in general. From a management perspective, there was no reporting metrics or quantitative tracking of efficiency.”

Memex Automation's John Rattray, was part of solution, taking Vermeer on their Lean journey. According to Rattray, "One of the requirements for the new system was an enterprise-based system utilizing the latest software tools and built under an MS-SQL database environment. It was to be deployed across the enterprise to provide a standard, robust monitoring and reporting tools for reliable, effective feedback to Lean and Continuous Improvement initiatives.”

Measuring events at the machine level

Continuous Improvement and Lean initiatives must reduce waste and improve quality. To realize these improvements, there must be measurements. Rattray applauded Vermeer champions because they realized that only through effective observation and response, could the company manage efficiency. That required they first measure actual events at the machine. "They estimated that there was vast potential for improvement, but without imperial data as proof, they were challenged at procuring management adoption of initiatives. Vermeer then underwent a formal buying process, looking very carefully at the many automated data collection products and their suppliers, with their main interest in how they would track the Utilization metric of OEE (Overall Equipment Effectiveness),” shared Rattray.

Vermeer's requirements for a technology solution had to provide an easy to use system that was running all the time, self-maintaining, and did not require constant attention. Gary Vermeer adds "it was necessary for the supplier company we selected have a reliable reputation and would be able to assist in the installation of the equipment. Ideally, we wanted a system that was an off-the-shelf packaged toolkit that could then be adapted to many machines.”

A key requirement of the new system was to validate utilization estimates and operator labor; therefore being considered) include logistics recommendations that will improve both productivity and setup times as well as establish practices and submit recommendations that will improve setup time, without sacrificing productivity (resulting in increased capacity.)

Shop floor monitoring system has provided Vermeer visibility of production metrics to all management and shop floor personnel, including the Director of Manufacturing. The result has been an improvement of operator time through setup procedures and techniques at each machine.

Rattray says "Vermeer expects significant process changes over time as they utilize the data for continuous improvement. Audible alerts to the operator at each machine prompt for action and advanced reporting with text and email alerts to key management ensures real-time knowledge and actionable data.”

Operator acceptance: A culture shift with lean initiatives

Cultural change was observed as the Process Engineering department at Verneer, became part of the Manufacturing, where the "Team” owns the complete process. There was concern that the new system might meet with some operator resistance. While operator acceptance was an issue initially, they quickly realized that it made their job easier by collecting information automatically. Certain operator functions and triggers were desired, which took minimal training. A feature of the system is the email function - a drop down selection on the HMI for "Automation” which calls the local administrator to immediately assist and ensure that the system was operating properly.

Effective real-time OEE creates immediate cost justification

This effective deployment of real-time OEE automated data collection has resulted irrefutable data that such technology monitor tracking systems are easily cost-justified. Vermeer found an increase in OEE expected to be 100% overall, as machine utilization moving from 30-35 per cent to over 65 per cent. The reduction of setup time by 60 minutes per shift, directly improved capacity and actual use of the data eliminated any guessing that occurred previously.

Gary Vermeer was clear, "We make better decisions with respect to utilization, as well as capital expenditure and decision making. We saw an increase of 50% in machine utilization very early on after the system was installed and the financial justification was a 10 per cent improvement in shop floor efficiency.”

The operational goal is a fifty per cent improvement through evidence-based continuous refinement of lean techniques that impact both welding and enterprise-wide operations.

Thomas R. Cutler is the president & CEO of TR Cutler Inc. Cutler is the founder of the Manufacturing Media Consortium including more than 4000 journalists, editors, and economists writing about trends in manufacturing, industry, material handling, and process improvement.